July 29, 2003

Futures market to bet on terrorism?

I had a hard time believing this when a friend at work told me about the U.S. government's plan to create a futures market where "investors" could bet on a variety of events in the middle east, from assasinations to bombings. But, alas, it was true. Links: NYTimes (requires free account), MSNBC

It is true. It has to do with the "collective wisdom" of the markets being an extremely accurate predictive tool. For example orange futures are an excellent predictor of the weather. It was a logically sound, if politically naive attempt to get the "best thinking" on terrorism.